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Tuesday, 14 April 2009

Do you think an advertising spend of $1 million that gets $1.28 million in retail sales is a great investment?

Think about it before you answer.

In AdAge's online mag, with breathless excitement, it was suggested on this basis that "outlays on social networks by package-goods brands can result in offline sales impact and deliver positive return on investment."

Depends on what you mean by positive. Positive if you don't have to do a few trivial things like getting the raw materials, then making, packaging, selling-in, distributing, displaying and retailing your stuff.

I think grown-ups know that no sane firm planning to stay in business for another few days spends a dollar to get $1.28 in sales. Grown-ups know that in the sector mentioned, Consumer products, 7.9:100 was the last quoted average from leading authority Schonfeld & Associates. Not 100:128.

But just in case you think nobody could be that stupid, the people who wrote this report said, "by the measure that matters most, sales, the campaign appeared to pay off nicely. It produced $1.28 million in offline sales."

If you found a way of wasting money to that degree, then knew so little you boasted about it, any normal boss would throw you out in the street. But of course, we all know social media are THE thing and marketers are like sheep.

In the favourite phrase of my old boss David Ogilvy, "Stupid bastards."

Or to put it more simply a great many people in marketing haven't the vaguest vestige of a clue. I blame the schools. Bring back arithmetic.

Do you think an advertising spend of $1 million that gets $1.28 million in retail sales is a great investment?

Think about it before you answer.

In AdAge's online mag, with breathless excitement, it was suggested on this basis that "outlays on social networks by package-goods brands can result in offline sales impact and deliver positive return on investment."

Depends on what you mean by positive. Positive if you don't have to do a few trivial things like getting the raw materials, then making, packaging, selling-in, distributing, displaying and retailing your stuff.

I think grown-ups know that no sane firm planning to stay in business for another few days spends a dollar to get $1.28 in sales. Grown-ups know that in the sector mentioned, Consumer products, 7.9:100 was the last quoted average from leading authority Schonfeld & Associates. Not 100:128.

But just in case you think nobody could be that stupid, the people who wrote this report said, "by the measure that matters most, sales, the campaign appeared to pay off nicely. It produced $1.28 million in offline sales."

If you found a way of wasting money to that degree, then knew so little you boasted about it, any normal boss would throw you out in the street. But of course, we all know social media are THE thing and marketers are like sheep.

In the favourite phrase of my old boss David Ogilvy, "Stupid bastards."

Or to put it more simply a great many people in marketing haven't the vaguest vestige of a clue. I blame the schools. Bring back arithmetic.

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The man Bird and his sad story

The CIM named Drayton one of 50 people who shaped today’s marketing.
And David Ogilvy said he “knows more about direct marketing than anyone in the world.” But don't blame him for all the crap you get sent.
He published his first novel, “Some rats run faster” when 27. Hardly anyone read this brilliant work as it had virtually no plot. 4 more books followed: “Commonsense Direct and Digital Marketing” – out in 17 languages; “Salesletters that sell” & “Marketing Insights and Outrages” and "Direct Marketing for Lawyers".
He's written over 1,000 columns, spoken in 50 countries and worked with many leading brands, incl. Amex, BA, Hargreaves Lansdown, Mercedes, Microsoft, Nestle, P & G, IBM, Unilever and Visa.
In 1977, he and two partners set up Trenear-Harvey, Bird & Watson, sold in l985 to O&M. As Vice-Chairman and Creative Director, he helped O&M Direct become the world's largest DM agency network, and was elected to the worldwide Ogilvy Group board.
He now runs Drayton Bird Associates and has interests in 3 other firms. The ones he never visits do much better.
This blog shows what all that has done to his head.